Trade Spotlight: PVR, State Bank of India & HPCL in focus

Indian market closed in the green for the fourth consecutive day in a row on November 5 following a positive trend in other Asian markets which scaled a near three-year peak.

Markets across the globe rose as investors wagered the prospect of US policy gridlock would greatly favour some industries.

The risk of a prolonged contested election did remain, though the count was progressing in an orderly fashion with Democratic challenger Joe Biden narrowly ahead in key states.

Back home, the Nifty50 reclaimed 12,000 levels while the S&P BSE Sensex rallied more than 700 points.

Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 724 points to close at 41,340 while the Nifty50 rose 211 points to end at 12,120 on Thursday.

Sectorally, the action was seen in metals, public sector, oil & gas, energy as well as banks.

PVR rose by over 9 percent, SBI gained over 5 percent, and HPCL rallied nearly 10 percent were in focus on Thursday.

We have collated views of experts on what investors should do when the market resumes trading on 6 November:

Expert: Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities

PVR: A close below Rs 1,140 may trigger further weakness

Since the last four days, the stock has been rising rapidly. On November 5, the stock opened with a gap-up and maintained strong momentum throughout the day.

This week so far, the stock has rallied nearly 15 percent and after a long time, it managed to trade above the Rs 1200 mark.

However, the medium-term chart formation is still on the negative side and that would create doubt in the traders' minds.

SBI: Stock could rally up to Rs 230

The stock rallied over 5 percent on November 5. Post the gap-up opening above 200-day SMA, the stock hovered between 215 to 220 price ranges for the entire day.

In the short-term time frame, the stock has formed a strong price volume breakout pattern. The texture of the pattern suggests that the breakout action will continue in the near-term if the stock succeeds to trade above Rs 211 or 200-Day SMA level.

In addition, on weekly charts, SBI has formed a strong trend reversal formation pattern which suggests high chances of the further uptrend from current levels.

For the traders who want to play the breakout, Rs 211 should be the sacrosanct level. If the stock trades above the same we can expect an uptrend continuation wave up to Rs 230.

HPCL: Bulls are in total control and uptrend likely to continue

Since the last couple of months, the stock has been in the correction zone. The correction has been steep and price dominating.

The stock has corrected nearly 30 percent, from its previous resistance of Rs 240. However, post sharp correction, HPCL has formed a strong higher bottom series pattern on daily charts and double bottom kind of formation on weekly charts which is broadly positive.

On Thursday, HPCL opened with a gap and not only surpassed the Rs 200 mark but comfortably manages to trade above the same. The strong price volume activity indicates bulls are in total control and the uptrend wave will likely persist in the short run.

On daily charts, the stock has formed a strong price volume breakout formation. For positional traders, Rs 195 should be the key level to watch.

Trading above the same, we can expect an uptrend continuation wave up to Rs 212-220. On the flip side, on a close below Rs 195, traders may prefer to exit out from long positions.